Client Money Protection
The Client Money Protection (CMP) Scheme is a compensation scheme run by the National Federation of Property Professionals (NFoPP) which provides compensation to landlords, tenants and other clients should an agent misappropriate their rent, deposit or other client funds.
As a professional body, raising standards and providing consumer protection are key factors; the Client Money Protection Compensation Scheme plays an integral part in this.
Help spread the word!
Since May 2015 it has been a legal requirement for letting agents to display fees along with details of the redress scheme that they belong to and membership of a client money protection scheme where appropriate. Please display your CMP Certificate in your office as evidence for your clients that their money is protected.
As a membership organisation, we also rely upon our members to help raise public awareness. Why not use the professionally printed CMP Leaflet and the ARLA exclusive flyer in your promotional material when seeking a new instruction? Both of these documents are subsidised as we believe that the scheme is key to promoting the service that our members offer.
Please note: For Regulated by RICS companies, or companies regulated by the Law Society or the Law Society of Scotland, these requirements do not apply. We accept evidence that a company is regulated by one of those organisations in lieu of our own regulation.
Client Money Protection FAQs
What are the benefits of Client Money Protection to agents?
Protection of clients' money, giving the public further trust and confidence in dealing with you, our members.
A differentiator setting you apart from those who do not belong to a professional body and who do not have CMP in place.
A discount of £1.50 per tenancy deposit is offered by the Tenancy Deposit Scheme (TDS) for those members who have CMP through our scheme. This discount is not available to all professional bodies / schemes.
Do I have to have Client Money Protection?
It is a mandatory requirement of association membership for Principal, Partner, Director (PPD) members that they have CMP in place for every company that acts as an agency in property (including the auctioning of chattels), and that handles client money or uses a third party to control its client money.
Doesn't my professional indemnity insurance cover client money?
There is an element of fidelity bonding in professional indemnity insurance policies, but this only provides you with protection should your staff misappropriate client funds. A CMP scheme can provide the public with protection should the agent do so.
Can I shop around for Client Money Protection?
Not all schemes provide the same levels of cover to your clients that ours does, nor do they necessarily qualify you for a discount per tenancy deposit from the TDS. The only other scheme available which we can currently accept in lieu of our own is the one run by the Royal Institution of Chartered Surveyors (RICS).
I have already paid for the NALS CMP scheme. Surely I don’t need yours as well?
If you are a member of one of the NFoPP divisions (ARLA, NAEA, ICBA, NAVA), then NALS would not pay out on any CMP claim. NALS relies on our members belonging to the NFoPP scheme. Their CMP scheme excludes members of NFoPP divisions. You must therefore be a member of either the NFoPP CMP scheme or the RICS scheme.
How much is the Client Money Protection Levy?
There is a one-off fee of £180 to join the scheme. The 2017 levy is £340. You can find an introduction to the 2017 scheme in an open letter from the MDs of ARLA and NAEA here.
What happens if I don’t pay my CMP Levy?
Late submission of documentation concerning professional indemnity insurance, accountant’s reports and declarations, and late payment of the client money protection scheme levy, may be pursued as a disciplinary matter. Such matters will be dealt with outside of the disciplinary procedures. In these circumstances members may not have an opportunity to explain the reasons for their delay. Instead, late submission is likely to result in an automatic fine of up to £200 per breach of every separate requirement. Members who persistently fail to provide their documents will have their membership terminated.
How do I pay the Client Money Protection Levy?
You can pay the Client Money Protection Levy in the following ways:
- By credit/debit card using our automated telephone line. Please call 0161 393 6256. Please use the transaction number on your invoice.
- By BACS transfer. Please use these bank details, and quote your invoice number (it begins with the letter I) to enable us to trace the payment.
- By cheque. Please make your cheque payable to "National Federation of Property Professionals" (please include a copy of your invoice), and send to Document Regulation (CMP) at the address at the foot of this page. Please allow a week for cheques to arrive.
Should you have any queries, please call 01926 417 365.
Where can the public find out about the CMP scheme?
You can find information for the public about the scheme, about how to make a claim, and the CMP leaflet, here: www.nfopp-regulation.co.uk/protecting-clients-money.
Supposing my bank fails? What about the Financial Services Compensation Scheme?
Please refer to The Financial Services Compensation Scheme PDF for information.
The Property Ombudsman (TPOS) are asking for my CMP insurance policy number. Where can I find it?
There is no policy number. The CMP scheme is not an insurance policy, but a compensation scheme. For those companies in the NFoPP CMP scheme TPOS will accept NFoPP in lieu of a policy number.
I don’t need Client Money Protection anymore. Can I get a refund on what I’ve already paid?
No, I am afraid not. Your payment is an annual levy, charged at a flat rate per legal entity as a contribution to the cost of running the scheme. Once paid, your company’s clients will continue to have protection for their money your company handled whilst you were in membership.